Job creation: A governor's job?

Pennsylvania's economy is still climbing back from the beating it took in the Great Recession.

Employment remains about 60,000 jobs short of its 2008 peak of 6.1 million, and while the unemployment rate has fallen to 6 percent, it's still higher than the pre-recession rate of 4.2 percent.

It's not surprising that polls show the economy remains near the top of voters' list of concerns.

The four Democrats running for governor argue that the state's recovery has been too sluggish, while Republican Gov. Tom Corbett, who is running unopposed in the primary, touts his success in cutting unemployment.

According to the state Department of Labor and Industry, 164,000 more Pennsylvanians have jobs today than in January 2011, when Corbett took office. At the time, unemployment sat at 8.1 percent, about two points higher. Corbett attributes those advances to a conservative approach to spending and taxes.

That's clear in his campaign slogan: "More Jobs, Less Taxes."

That means "working with the private sector instead of hindering them to create those jobs and put Pennsylvania back to work," said Corbett spokesman Billy Pitman.

Democrats prefer to attribute those gains to a national recovery. They point to statistics that say the state's rate of job growth trailed most other states during Corbett's tenure, and that 397,000 Pennsylvanians without work is too many.

For 2013, Pennsylvania ranked 48th in job creation, according to Arizona State University's W.P. Carey School of Business job growth calculator, although economists say that's influenced somewhat by the state's relatively mild job losses during the Great Recession.

In its assessment of Pennsylvania's recovery, Standard & Poor's wrote last week that "despite a diverse economy, employment growth in the state has been anemic" over the last year. It has recovered 78 percent of the jobs lost during the recession, compared with 95 percent nationally.

The Democrats' strategies for bringing the state's economy back vary, but they include working with the state's universities to boost research and development, promoting investments in clean energy technology and improving technical training to put the unemployed to work and meet the needs of manufacturers.

The problem, say economists, is that the powers of a governor are limited.

"If you think about what is going to happen next year or over the next couple of years, movements in the national or global economy are going to dwarf what a governor does," said Kenneth Smith, chairman of the economics department at Millersville University.

To keep things simple, The Morning Call examined where the candidates stand on three areas where the state can affect individual and business economies: employee wages, the business tax environment and the state's natural gas boom.

Minimum wage

One economic strategy all the Democrats agree on is raising the minimum wage. It's a move that would affect some 20 percent of Pennsylvania's workforce, according to the Economic Policy Institute, as wages at the bottom of the pay scale are adjusted upward.

Over the last decade, the median household income in Pennsylvania has declined 2.8 percent, according to Census Bureau figures. In 2012, the last year for which data is available, household incomes were flat, at about $51,230 according to the American Communities Survey.

Wolf, Schwartz and McGinty all agree the minimum wage should be increased to $10.10 from its current $7.25 and tied to inflation, increasing each year to keep up with the cost of living. That would bring a full-time, minimum wage worker's annual pay to $21,000.

The plan mirrors a minimum wage proposal being pushed unsuccessfully at the federal level by Democrats.

Rob McCord ups the ante a bit, suggesting the minimum wage should be $10.70 for most jobs, and increased 10 cents a year after that for a decade. In a move designed to help businesses that rely on seasonal, teenage workers, minimum wage for student workers would remain at $7.25, increasing each year by the same 10-cent increment.

He arrived at the figure by adjusting the 1968 minimum wage, which was the peak in terms of purchasing power, for inflation.

Most business groups hate the idea, especially those representing small businesses. The conservative National Federation of Independent Business commissioned a study of several bills to raise the minimum wage in March, finding an increase to $9 an hour would cause 119,000 lost jobs over a decade.

"No matter what the circumstances, even with the ones that were less than $10.10, it showed there would be job losses," said NFIB spokeswoman Suzanne Collins Stoltenberg.

Small businesses would be forced to raise prices, cut back on hours and workers or resort to increased automation, she said.

Corbett opposes raising the minimum wage, saying it will hurt the state's competitiveness.

There is a good deal of disagreement among economists on the effects of increasing the minimum wage.